Ask Capacity: How Has the Fulfillment Business Changed Over the Years?

March 31, 2016

We’ve been at this for a long time. With more than 15 years in the fulfillment business and decades of collective experience in and around the supply chain, it’s fair to say we’ve seen our share of changes.

Capacity was founded in 1999, so we can claim to have operated in something of a pre-digital era — or, at least, a time when Wi-Fi wasn’t the first thing people asked about when they walked in the door!

We are often asked what kind of changes we’ve seen over the years and thought answering this would be an appropriate way to end our month exploring the ongoing evolution of order fulfillment

Learning on the Job

Even though the Internet was in its infancy when we started, connectivity was still an important consideration for fulfillment success. Clients have always needed to know where their product is located and how far along individual orders have progressed.

Nonetheless, the standards and expectations around these basic principles of the fulfillment business have changed.

“We still use people, technology, warehouses, pallets and trucks to move goods, but not much else has remained the same,” says Thom Campbell, Capacity’s CSO and co-founder. In our Fulfillment Fundamentals webinar last year, Thom recalled nights spent sleeping on the office floor with fellow founder and CEO Jeff Kaiden, following an exhausting day of getting the job done for our initial clients.

Reminiscing on Capacity’s early days, Campbell explains:

“For our second major client, we moved 70 truckloads over 5 days. There were a number of ‘all-nighters’, which are considerably easier when you in college than when you are running a business!”

“We got through it and never faced the same challenge again. But the experience provided key learnings, ranging from how many trucks you can take in a day to an understanding of what an extended sleep deprivation experiment is like.”

Those days are long gone, of course, but the experience was enough to drive new systems and ways of working to make everything more efficient. Our experience and desire to expand play a big part in that improvement, but there’s no denying the influence that technological advancements have had in moving things forward.

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Changes to Fulfillment BUSINESS Technology

We looked at a lot of fulfillment technology changes last week, so let’s hand over to CSO Thom Campbell again for an inside look at how technology continues to drive the fulfillment business forward:

“Some very basic changes we’ve seen range from current standards like EDI (electronic data interchange) to RFID (radio-frequency identification tags), all the way to robotics. And not just robots inside the warehouse – according to the WSJ today, the ports are starting to use them. Drones were not just a distraction tactic from Amazon, they are coming.”

Drones, robots, and automation have been on everyone’s lips for a long time. The double-edged sword of our human desire to see machines take over everyday tasks extends far beyond the warehouse and supply chain, but it impacts our industry more than most.

The impact of advancing technology isn’t limited to physical tasks, either. Data storage and transfer is more important than ever, as Campbell continues to explain:

“Cloud computing will likely transform the industry as much as any development. With greater processing speeds and limited memory constraints opening up the possibility of cloud-based WMS (warehouse management software/systems), the sky is the proverbial limit. The volume of data packets transferred is no longer the significant obstacle that it has been.”

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The Supply Chain is Speeding Up

Mirroring the modern world, the digital era that has consumers connected almost 24/7 is presenting a similar speed challenge to those of us in the fulfillment business. When a customer can browse, choose, and order an item in just a few minutes, it should come as no great surprise that they expect it to arrive almost as quickly.

If that sounds exaggerated, just consider how Amazon is driving down delivery times to within an hour of ordering right on our doorstep in New York City, as well as other major urban centers around the United States.

“The world of fulfillment is becoming faster and more complex,” explains Capacity’s Special Projects Manager, Ed Shapiro. “Instead of delivering an order in several days, orders must be out the door in a matter of hours.”

As our clients adapt to meet the requests and expectations of their customers, so must we adjust to add more value and flexibility to the order fulfillment services we provide. Shapiro offers an example:

“Rather than using standardized cardboard boxes and bubble wrap, we see clients enhancing the at-home brand experience with customized packing and shipping materials.”

“We also focus on blending technological enhancements with operational fluidity for our clients. For a recent example, we completed an in-house enhancement that allows an entire group of employees to seamlessly ship order, rather than running all packages through a few shipping terminals.”

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The More Things Change, the More They Stay the Same

Against the backdrop of this dynamic industry, Shapiro sums up his experience:

“Our commitment to continuous improvement has helped us grow and remain a leader in this ever-changing landscape.”

It’s a thought that underlines the need to remain vigilant to changes in our business, by staying on top of what others are doing and conducting regular reviews of our own operation.

With all of this increased visibility and advancing technology, however, order fulfillment comes down to a goal that is constant: get the right product to the right customer, on time and in store quality condition.


 

Let us know on Facebook or Linkedin how you’ve seen the fulfillment business change over the years. And if you could use some help keeping up with customer expectations, contact us today!